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Question
Mandatorily redeemable preferred stock is reported on the balance sheet as
A. a liability.
B. an equity item.
C. a temporary investment.
D. a separate line between liabilities and shareholders' equity.
Answer
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Related questions
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A factor that can reduce managers' short-term focus is the fact that incentive compensation plans are administered by a compensation committee that can intervene when circumstances warrant modification of the scheduled incentive award.
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Managerial strategies and decisions clearly affect stock prices both in the short and long run.
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Borrowers do not appear willing to pay substantially higher interest rates to retain accounting flexibility that may help them avoid covenant violations.
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Because covenant compliance can be jeopardized by mandated changes in accounting principles, many loan agreements have financial covenants that rely on the accounting rules in place when the loan is first granted.
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Commercial lending agreements may contain provisions that are designed to protect the lender from a deterioration of the borrower's creditworthiness.
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Risky firms have a higher risk-adjusted cost of capital. Which one of the following factors would contribute to that firm also having a high price/earnings ratio?
A. High earnings per share.
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Rate regulation provides incentives for public utility managers to
A. artificially decrease the asset base.
B. artificially increase the asset base.
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A. only the administrative costs of operations.
B. only the operating costs associated with operations.
C. all operating costs, depreciation, taxes, and a fair return on invested capital.
D. all operating costs other than depreciation and taxes, and a fair return on invested capital.
Q:
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A. base salaries.
B. short-term incentives.
C. long-term incentives.
D. executive compensation packages.
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A. affirmative restrictions.
B. affirmative covenants.
C. negative restrictions.
D. negative covenants.
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A. lenders.
B. borrowers.
C. both lenders and borrowers.
D. neither borrowers nor lenders, but are required by the SEC as a condition of issuing debt securities.
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A. few business relationships.
B. only relationships between investors and managers.
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D. many business relationships.
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A. the consignor.
B. the consignee.
C. both the consignor and the consignee.
D. neither the consignor nor the consignee.